Vol. XLI No. 47 November 17, 2017

Farmers Lost Over Rs 2 Lakh Crore Due to Low Prices of Crops this Year

Subodh Varma

FOLLOWING the massive workers’ Mahapadav on November 9-11 at Delhi, it is now the farmers’ turn to occupy the capital. Thousands of farmers from all over India will congregate at Delhi to demand better prices for their produce and complete freedom from debt. Many families of farmers who committed suicide in the recent past due to debt will also participate in what is being called the Kisan Mukti Sansad (Farmers’ Liberation Parliament).

During the election campaign for the 2014 Lok Sabha elections, Narendra Modi had promised that farmers would get good prices for their crops. He assured that if elected, his government would implement the price formula recommended by the MS Swaminathan Commission, which was a fixed minimum support price that covers the cost of production and gives an additional 50 per cent of that to the farmer.

More than three years have passed since Modi won the election and became the prime minister. But there is no talk of this promise. In fact, the agriculture minister even denied in parliament that such a promise was made.

What is the cost of this betrayal? The All India Kisan Sangharsh Coordination Committee (AIKSCC), an umbrella forum of over 180 farmers’ organisations, has calculated that for the top seven crops in the kharif season this year, farmers got prices that were less than Modi’s promise by a whopping Rs 2 lakh crore. The seven crops studied were paddy, maize, soybean, cotton, bajra, groundnut and urad. Market arrivals and costs across hundreds of mandis were analysed by the AIKSCC activists. This has been dubbed Kisan ki Loot (plunder of farmers) by the Sangharsh Committee.

For example, Bhagat Singh, a farmer from Haryana sold 19 quintals of bajra crop. While the MSP is Rs 1425 and the deserved MSP as per PM’s election promise is Rs 1917, the farmer got only Rs 1135 per quintal. This meant Kisan ki Loot of Rs 14,858. A woman farmer from Andhra Pradesh, Gaddam Lalithamma sold 31 quintals of groundnut at a mere Rs 2600 per quintal while the MSP is Rs 4450 and PM’s promised MSP would be Rs 6134. The Kisan ki Loot of this farmer is Rs 1,09,554.

AIKSCC found that farmers would lose Rs 35,968 crores as compared to prevailing MSPs. This is because in most places farmers don’t even get the government backed MSP. If compared to PM’s promise of cost price+50 per cent, the loss balloons to over Rs 2 lakh crore. The reason for this difference between their current loss and the potential loss compared to PM’s promise is that even the declared MSPs are highly inadequate. However, among the 14 crops of Kharif 2017-18, the MSPs for seven crops have been fixed less than the cost of production. In the other seven crops, the margin above cost of production is merely 2 per cent to 19 per cent.

Steadily rising input costs, like fuel, pesticides and fertilizers and even water, slashing of subsidies by the government, are some of the key factors behind this skew in cost versus income imbalance. Another major factor is the opening up of economy to agricultural imports and integration of India’s production with global markets that causes local prices to crash, as has happened in tea, groundnut, rubber etc. Between 1990-91 and 2011-12, while agricultural exports grew at an annual rate of about 13 per cent, agricultural imports grew at a faster rate of about 21 per cent, according to R Ramakumar of TISS.

This massive injustice in prices is pushing farmers into debt and suicides across the country and igniting repeated protests across the country. In the past two years, farmers have agitated for better prices to their produce in Maharashtra, Rajasthan, Karnataka, Madhya Pradesh and several other states. Besides these, the Bhoomi Adhikar Andolan, a front of over 300 organisations, has held kisan jathas across the country in 2016 and AIKSCC organised a Kisan Mukti Yatra covering over 10,000 kilometers throughout the country, meeting nearly 50 lakh farmers and strengthening their struggles.

“It is to address this loot of farmers that we are congregating in large numbers in Delhi on November 20 in a Kisan Mukti Sansad to be organised on Parliament Street. Full remunerative prices as a legal entitlement with correct cost estimations and at least a 50 per cent profit margin over the cost of production, for all farmers and commodities, is our main demand, in addition to a demand for freedom from debt, that includes a comprehensive immediate loan waiver as well as statutory institutional mechanism that addresses farmers’ indebtedness on an ongoing basis,” said AIKSCC leaders at a recent press meet.

On November 20, a draft Bill encompassing the two demands will be introduced and passed after debate by the farmers’ parliament. AIKSCC will invite leaders of political parties and the prime minister to come to the Sansad – but only if they are ready to support the Bill and the demands.